The US Treasury has sanctioned Philippines-based Funnull Technology for allegedly aiding virtual currency scams known as “pig butchering.”

Funnull is accused of buying and reselling IP addresses to cybercriminals, and its alleged administrator, Liu Lizhi, has also been sanctioned.

Liu is reportedly associated with addresses in Shanghai and Ganzhou.

Funnull could not be reached for comment and is not listed in the Philippines’ corporate registry.

These scams trick victims into fake crypto investments and are linked to a network of fraudulent and criminal websites.

“Pig butchering” scams have gone global, with rising revenues fueled by generative tech that helps scammers better target victims.

🔗 Source: Reuters

🧠 Food for thought

1️⃣ Cryptocurrency scams have grown exponentially despite increased awareness

The size of cryptocurrency-related fraud has expanded dramatically over recent years, with the FBI reporting $5.6 billion lost to crypto investment scams in 2023 alone, a 45% increase from 2022 1.

This growth trajectory follows a pattern established earlier, when illicit cryptocurrency flows jumped from $7.8 billion in 2020 to over $14 billion in 2021 2.

The “pig butchering” schemes targeted by these latest sanctions represent one of the most profitable segments in this criminal ecosystem, with Chainalysis data showing illicit cryptocurrency addresses now receiving approximately $40.9 billion annually 3.

The rapid expansion demonstrates how cryptocurrency scams have evolved from isolated fraud attempts into industrial-scale operations with sophisticated infrastructure needs. Targeting companies that provide this infrastructure is crucial to disrupting these operations.

These scams now typically involve multiple criminal enterprises working in coordination, with specialists handling different aspects from technical infrastructure to social engineering.

2️⃣ Technology infrastructure providers have become critical enablers of financial crime

The Treasury’s action against Funnull Technology highlights how cybercriminals rely on legitimate business infrastructure to scale their operations.